BP partner Anadarko refuses to pay spill bill

DISASTER IN THE GULFAnadarko won't pay big bill sent by BPMajority owner of Macondo well expects a check for $272 million

PURVA PATEL, Copyright 2010 Houston Chronicle

Published 5:30 am, Friday, July 9, 2010

Anadarko Petroleum Corp. won't pay the $272 million in oil spill related costs that BP billed it for last month.

The Woodlands-based company has a 25 percent nonoperating stake in the Macondo oil well gushing in the Gulf of Mexico.

The company has argued that it's not responsible for costs arising from an operating partner's "negligence" or "willfull misconduct" — something it accuses BP of in relation to the spill.

"Multiple proceedings and independent investigations are under way into BP's actions and decisions on the rig, and although we have notified BP that we are withholding reimbursement to BP at this time, we remain committed to working with BP in good faith to achieve a satisfactory resolution," spokesman John Christiansen said in a written statement Friday.

Last month, Anadarko CEO James Hackett said BP should shoulder the costs of the spill. BP has said it strongly disagreed with Anadarko's allegations.

Evaluating its options

BP, in a written statement Friday, said it was disappointed Anadarko "failed to live up to their obligations under the Macondo Operating Agreement and as a responsible party under the Oil Pollution Act," and will continue to evaluate its legal options.

A division of Japanese trading company Mitsui has a 10 percent stake in the well and has received a $111 million bill from BP. The deadline for payment from the company is Monday , but to date it has not responded to the bill, according to BP's statement.

The company could not be reached for comment Friday.

Analysts said the dispute will likely result in a legal battle if BP continues pressing for the money. They expect Anadarko to continue fighting the payments.

Putting it off

Anadarko is likely trying to at least delay any possible payment because of the financial impact it could have on the company, said Richard Tullis, an analyst with Capital One Southcoast.

"It's significant money for anybody, but particularly for Anadarko," Tullis said. "They don't generate anywhere near the cash flow a year that BP does."

Moving target

Both Anadarko and Mitsui should be able to hold BP off at least until the investigations are complete, said Neal Dingmann, an analyst with Wunderlich Securities. He added that how much BP ends up paying for the spill is also a moving target that could determine the final effect on both companies.

So far BP has spent about $3.1 billion on spill-related costs, the company said earlier this week.

Anadarko's shares closed up 2 percent at $45.41 Friday. BP, in U.S. trading, closed up 1 percent at $34.05.